1
Exhibit 10.5
COMMERCIAL SECURITY AGREEMENT
Borrower: Tunica-Biloxi Tribe of Louisiana Lender: Hibernia National Bank
▇▇▇ ▇▇▇▇▇ ▇▇▇▇. ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ Shreveport, LA. 71101
THIS COMMERCIAL SECURITY AGREEMENT is entered into between the
Tunica- Biloxi Tribe of Louisiana (referred to below as "Grantor") and Hibernia
National Bank (referred to below as "Lender"). For valuable consideration,
Grantor hereby pledges to Lender and grants to Lender a continuing security
interest in the Collateral to secure Grantor's present and future Indebtedness
and agrees that Lender shall have the rights stated in this Agreement with
respect to the Collateral, in addition to all other rights which Lender may have
by law or otherwise.
DEFINITIONS. The following words shall have the following meanings when used in
this Agreement. Terms not otherwise defined in this Agreement shall have the
meanings attributed to such terms in the Louisiana Commercial Laws (La. R.S. 10:
9-101, et seq.) and in the Loan Agreement. All references to dollar amounts
shall mean amounts in lawful money of the United States of America.
AGREEMENT. The word "Agreement" means this Commercial Security
Agreement, as this Commercial Security Agreement may be amended or modified from
time to time, together with all exhibits and schedules attached or to be
attached to this Commercial Security Agreement from time to time.
CASINO BANK ACCOUNTS. The words "Casino Bank Accounts" means all of the
bank accounts specified or contemplated in Section 5.10 of the Management
Contract, all of which shall be maintained with the Cottonport Bank.
COLLATERAL. The word "Collateral" means individually, collectively and
interchangeably any and all of Grantor's present and future rights, title and
interest in and to the following described property, together with any and all
present and future additions thereto, substitutions therefor, and replacements
thereof:
ALL CASINO BANK ACCOUNTS MAINTAINED BY OR ON BEHALF OF GRANTOR
WITH THE COTTONPORT BANK AND RELATED FUNDS DEPOSITED BY, OR ON
BEHALF OF, THE GRANTOR WITH THE COTTONPORT BANK; AND
ALL OTHER EQUIPMENT AND MACHINERY PURCHASED BY GRANTOR WITH FUNDS
ADVANCED BY LENDER TO GRANTOR OR ON BEHALF OF GRANTOR (THE
"EQUIPMENT").
The Collateral also includes any related equipment wherever located, and any and
all additions thereto and substitutions or replacements therefor, and all
accessories, attachments, and accessions thereto, whether added now or later,
and all products and proceeds derived or to be derived therefrom, including
2
without limitation all insurance proceeds and refunds of insurance premiums, if
any, and all sums that may be due from third parties who may cause damage to any
of the foregoing, or from any insurer, whether due to judgment, settlement, or
other process, and any and all present and future accounts, contract rights,
chattel paper, instruments, documents, and notes that may be derived from the
sale, lease or other disposition of any of the forgoing, and any rights of
Grantor to collect or enforce payment thereof, as well as to enforce any
guarantees of the forgoing and security therefor, and all of Grantor's present
and future general intangibles related or pertaining to the ownership,
operation, use or collection of any of the foregoing, including without
limitation Grantor's books, records, files, computer disks and software, and all
rights that Grantor may have with regard thereto. The word "Collateral" also
includes any and all present or future parts, accessories, attachments,
additions, accessions, substitutions and replacements to and for the collateral.
The word "Collateral" further includes any and all of Grantor's present and
future rights to any proceeds derived or to be derived from the sale, lease,
damage, destruction, insurance loss, expropriation and other disposition of the
Collateral, including without limitation, any and all of Grantor's rights to
enforce collection and payment of such proceeds.
"COTTONPORT BANK" means the Cottonport Bank of Marksville, Louisiana.
ENCUMBRANCES. The word "Encumbrances" means individually, collectively
and interchangeably any and all presently existing and/or future mortgages,
liens, privileges and other contractual and/or statutory security interests and
rights of every nature and kind that, now and/or in the future, may affect the
Collateral or any part or parts thereof.
EVENT OF DEFAULT. The words "Event of Default" mean individually,
collectively, and interchangeably any Event of Default as defined in the Loan
Agreement.
GRANTOR. The word "Grantor" means Tunica-Biloxi Tribe of Louisiana,
its successors and assigns.
INDEBTEDNESS. The word "Indebtedness" means the indebtedness evidenced
by the Note, in principal, interest, costs, expenses and attorneys' fees and all
other fees and charges, together with all other indebtedness and costs and
expenses for which Grantor is responsible under this Agreement or under any of
the Related Documents. In addition, the word "Indebtedness" also includes any
and all other loans, extensions of credit, obligations, debts, plus interest
thereon, of Grantor, or any one or more of them, that may now and in the future
be owed to or incurred in favor of Lender, as well as all claims by Lender
against Grantor, or any one or more of them, whether existing now or later;
whether they are voluntary or involuntary, whether related or unrelated, whether
committed or purely discretionary, due or to become due, direct or indirect or
by way of assignment, determined or undetermined, absolute or contingent,
liquidated or unliquidated; whether Grantor may be liable individually or
jointly with others, of every nature and kind whatsoever, in principal,
interest, costs, expenses and attorneys' fees and all other fees and charges;
and whether Grantor may be obligated as guarantor, surety, accommodation party
or otherwise.
LENDER. The word "Lender" means Hibernia National Bank, its successors
and assigns, and any subsequent holder or holders of the Note, or any interest
therein.
LOAN AGREEMENT. The word "Loan Agreement" means that certain Equipment
Loan Agreement
3
dated May 28, 1999, between Grantor and Lender.
MANAGEMENT CONTRACT. The words "Management Contract" means that
certain Amended and Restated Management & Construction Agreement dated November
1, 1991, between the Grantor and Grand Casinos/ Louisiana.
NOTE. The word "Note" means that certain promissory note dated May 28,
1999, in the principal amount of Six Million and No/100 Dollars ($6,000,000.00)
executed by Grantor in favor of Lender, together with all substitute or
replacement notes therefor, as well as all renewals, extensions, modifications,
refinancings, consolidations and substitutions of and for such a note.
RELATED DOCUMENTS. The words "Related Documents" mean and include
individually, collectively, interchangeably and without limitation all
promissory notes, credit agreements, loan agreements, environmental agreements,
guaranties, security agreements, mortgages, collateral mortgages, deeds of
trust, and all other instruments, agreements and documents, whether now or
hereafter existing, executed in connection with the Indebtedness.
CONTINUING SECURITY INTEREST TO SECURE PRESENT AND FUTURE INDEBTEDNESS. Grantor
affirms that Grantor has granted a continuing security interest in the
Collateral in favor of Lender to secure any and all Indebtedness of Grantor in
favor of Lender, as may be outstanding from time to time set forth above, in
principal, interest, costs, expenses, attorneys' fees and other fees and
charges, with the continuing preferences and priorities provided under
applicable Louisiana law.
DURATION OF THIS AGREEMENT. This Agreement shall remain in full force and effect
until such time as this Agreement and the security interests created hereby are
terminated and canceled by Lender under a written cancellation instrument in
favor of Grantor.
OBLIGATIONS OF GRANTOR. In addition to all of Grantor's agreements and
representations contained in the Loan Agreement, Grantor represents, warrants
and covenants to Lender as follows:
PERFECTION OF SECURITY INTEREST. Grantor agrees to execute such
financing statements and to take whatever other actions are requested by Lender
to perfect and continue Lender's security interest in the Collateral. Upon
request of Lender, Grantor will deliver to Lender any and all of the documents
evidencing or constituting the Collateral, and Grantor will note Lender's
interest upon any and all chattel paper if not delivered to Lender for
possession by Lender. Lender may at any time, and without further authorization
from Grantor, file a carbon, photographic, facsimile, or other reproduction of
any financing statement. Grantor will reimburse Lender for all reasonable
expenses for the perfection, termination, and the continuation of the perfection
of Lender's security interest in the Collateral. Grantor promptly will notify
Lender before any change in Grantor's name including any change to the assumed
business names of Grantor. Grantor also promptly will notify Lender of any
change in Grantor's Employer Identification Number. Grantor further agrees to
notify Lender in writing prior to any change in address or location of Grantor's
principal governance office. Grantor represents and warrants to Lender that
Grantor has provided Lender with Grantor's correct Employer Identification
Number and that Grantor has no other Employer Identification Numbers. Grantor
promptly shall notify Lender should Grantor apply for or obtain a new Employer
Identification Number or should Grantor merge or consolidate with any other
4
entity.
NO VIOLATION. The execution and delivery of this Agreement will not
violate any law or agreement governing Grantor or to which Grantor is a party,
and its tribal governance documents do not prohibit any term or condition of
this Agreement.
ENFORCEABILITY OF COLLATERAL. To the extent the Collateral consists of
accounts, chattel paper, or general intangibles, the Collateral is enforceable
in accordance with its terms, is genuine, and fully complies with applicable
state and federal laws and regulations concerning form, content and manner of
preparation and execution, and all persons appearing to be obligated on the
Collateral have authority and capacity to contract and are in fact obligated as
they appear to be on the Collateral, free of any offset, compensation, deduction
or counterclaim.
LOCATION OF THE COLLATERAL. Grantor, upon request of Lender, will
deliver to Lender in form satisfactory to Lender a schedule of real properties
and Collateral locations relating to Grantor's Business including, without
limitation, all properties where the Collateral is or may be located. Except in
the ordinary course of its business, Grantor shall not remove the Collateral
from its existing locations without the prior written consent of Lender.
REMOVAL OF COLLATERAL. Grantor shall keep the Collateral (or to the
extent the Collateral consists of intangible property such as accounts, the
records concerning the Collateral) at Grantor's address shown above, or at such
other locations as are acceptable to Lender. Except in the ordinary course of
its business, Grantor shall not remove the Collateral from its existing
locations without the prior written consent of Lender.
TRANSACTIONS INVOLVING COLLATERAL. Grantor shall not sell, offer to
sell, or otherwise transfer or dispose of the Collateral. Grantor shall not
pledge, mortgage, encumber or otherwise permit the Collateral to be subject to
any Encumbrance or charge, other than the security interest provided for in this
Agreement, without the prior written consent of Lender. This includes security
interests even if junior in right to the security interests granted under this
Agreement. Unless waived by Lender, all proceeds from any disposition of the
Collateral (for whatever reason) shall be held in trust for Lender and shall not
be commingled with any other funds; provided however, this requirement shall not
constitute consent by Lender to any sale or other disposition. Upon receipt,
Grantor shall immediately deliver any such proceeds to Lender.
TITLE, AUTHORITY, BINDING EFFECT. Grantor represents and warrants to
Lender that it holds good and marketable title to the Collateral, free and clear
of all Encumbrances except for Lender's security interest and except for
security interests granted to Grand Casinos of Louisiana, LLC--Tunica-Biloxi
which have been subordinated to the security interests granted under this
Agreement. No financing statement covering any of the Collateral is on file in
any public office other than those which reflect the security interest created
by this Agreement or to which Lender has specifically consented. Grantor further
represents and warrants that it has requisite authority to enter into this
Agreement in favor of Lender and to grant to Lender the security interest in the
Collateral as provided herein. Grantor additionally represents and warrants that
this Agreement is binding upon Grantor as well as Grantor's heirs, successors,
transferees and assigns, and is legally enforceable in accordance with its
terms. The foregoing representations and warranties and all other
representations and warranties of Grantor under
5
this Agreement shall be continuing and shall survive the termination of this
Agreement.
COLLATERAL SCHEDULES AND LOCATIONS. Grantor shall deliver to Lender, as
often as Lender shall require, such lists, descriptions, and designations of
such Collateral as Lender may require to identify the nature, extent, and
location of such Collateral. Such information shall be submitted for Grantor and
each of its subsidiaries or related companies.
REPAIRS AND MAINTENANCE. Grantor shall keep and maintain and shall
cause others to keep and maintain the Collateral in good order, repair and
merchantable condition. Grantor shall further make and/or cause all necessary
repairs to be made to the Collateral, including the repair and restoration of
any portion of the Collateral that may be damaged, lost or destroyed. In
addition, Grantor shall not, without the prior written consent of Lender, make
or permit to be made any alterations to any of the Collateral that may reduce or
impair the Collateral's use, value or marketability. Furthermore, Grantor shall
not, nor shall Grantor permit others to abandon, commit waste, or destroy the
Collateral or any part or parts thereof.
TAXES. Grantor shall promptly pay or cause to be paid when due, all
taxes, local and special assessments, and governmental and other charges of
every type and description, that may from time to time be imposed, assessed and
levied against the Collateral or against Grantor. Grantor further agrees to
furnish Lender upon request with evidence that such taxes, assessments, and
governmental and other charges have been paid in full and in a timely manner.
Grantor may withhold any such payment or elect to contest any lien if Grantor is
in good faith conducting an appropriate proceeding to contest the obligation to
pay and so long as Lender's interest in the Collateral is not jeopardized.
COMPLIANCE WITH GOVERNMENTAL REQUIREMENTS. Grantor shall comply
promptly with, and shall cause others to comply with, all laws, ordinances,
rules and regulations of all governmental authorities, now or hereafter in
effect, applicable to the ownership, production, disposition, or use of the
Collateral. Grantor may contest in good faith any such law, ordinance or
regulation and withhold compliance during any proceeding, including appropriate
appeals, so long as Lender's interest in the Collateral, is not jeopardized.
Grantor shall not use the Collateral, and shall not permit others to use the
Collateral, for any purpose other than those previously agreed to by Lender in
writing; but in no event shall any of the Collateral be used in any manner that
would damage, depreciate or diminish its value or that may result in
cancellation or termination of insurance coverage. Grantor additionally agrees
not to do or suffer to be done anything that may increase the risk of fire or
other hazards to the Collateral.
PRIOR ENCUMBRANCES. To the extent applicable, Grantor shall fully and
timely perform any and all of its obligations under any prior Encumbrances
affecting the Collateral. Without limiting the foregoing, Grantor shall not
commit or permit to exist any breach of or default under any such prior
Encumbrances. Grantor shall further promptly notify Lender in writing upon the
occurrence of any event or circumstances that would, result in a breach of or
default under any such prior Encumbrance. Grantor shall further not modify or
extend any of the terms of any prior Encumbrance or any indebtedness secured
thereby, or request or obtain any additional loans or other extensions of credit
from any third party creditor or creditors whenever such additional loan
advances or other extensions of credit may be directly or indirectly secured,
whether by cross-collateralization or otherwise, by the Collateral, or any part
or parts thereof, with possible preference and priority over Lender's security
interest. Grantor additionally agrees to obtain, upon request by Lender, and in
form and substance as may then be
6
satisfactory to Lender, appropriate waivers and/or subordinations of any
lessor's liens or privileges, vendor's liens or privileges, purchase money
security interests, and any other Encumbrances that may affect the Collateral at
any time.
FUTURE ENCUMBRANCES. Grantor shall not, without the prior written
consent of Lender, grant any Encumbrance that may affect the Collateral, or any
part or parts thereof, nor shall Grantor permit or consent to any Encumbrance
attaching to or being filed against any of the Collateral in favor of anyone
other than Lender. Grantor shall further promptly pay when due all statements
and charges of mechanics, materialmen, laborers and others incurred in
connection with the alteration, improvement, repair and maintenance of the
Collateral, or otherwise furnish appropriate security or bond, so that no future
Encumbrance may attach to or be filed against any Collateral. Grantor
additionally agrees to obtain, upon request by Lender, and in form and substance
as may then be satisfactory to Lender, appropriate waivers and/or subordinations
of any lessor's liens or privileges, vendor's liens or privileges, purchase
money security interests, and any other Encumbrances that may affect the
Collateral at any time.
NOTICE OF ENCUMBRANCES. Grantor shall immediately notify Lender in
writing upon the filing of any attachment, lien, judicial process, claim, or
other Encumbrance. Grantor additionally agrees to notify Lender immediately in
writing upon the occurrence of any default, or event that with the passage of
time, failure to cure, or giving of notice, might result in a default under any
of Grantor's obligations that may be secured by any presently existing or future
Encumbrance, or that might result in an Encumbrance affecting the Collateral, or
should any of the Collateral be seized or attached or levied upon, or threatened
by seizure or attachment or levy, by any person other than Lender.
GRANTOR'S RIGHT TO POSSESSION. Until default, Grantor may have possession and
beneficial use of all the Collateral and may use it in any lawful manner not
inconsistent with this Agreement or the Related Documents, provided that
Grantor's right to possession and beneficial use shall not apply to any
Collateral where possession of the Collateral by Lender is required by law to
perfect Lender's security interest in such Collateral. If Lender at any time has
possession of any Collateral, whether before or after an Event of Default,
Lender shall be deemed to have exercised reasonable care in the custody and
preservation of the Collateral if Lender takes such action for that purpose as
Grantor shall request or as Lender, in Lender's discretion, shall deem
appropriate under the circumstances, but failure to honor any request by Grantor
shall not of itself be deemed to be a failure to exercise reasonable care.
Lender shall not be required to take any steps necessary to preserve any rights
in the Collateral against prior parties, nor to protect, preserve or maintain
any security interest given to secure the Indebtedness.
EXPENDITURES BY LENDER. Grantor recognizes and agrees that Lender may incur
certain expenses in connection with Lender's exercise of rights under this
Agreement. If not discharged or paid when due, Lender may (but shall not be
obligated to) discharge or pay any amounts required to be discharged or paid by
Grantor under this Agreement, including without limitation all taxes,
Encumbrances and other claims, at any time levied or placed on the Collateral.
Lender also may (but shall not be obligated to) pay all reasonable costs for
insuring, maintaining and preserving the Collateral, including without
limitation, the purchase of insurance protecting only Lender's interest in the
Collateral. Lender may further take such other action or actions and incur such
additional expenditures as Lender may deem to be reasonably necessary and proper
to cure or rectify any actions or inactions on Grantor's part as may be required
under this Agreement. Nothing under this Agreement or otherwise shall obligate
7
Lender to take any such actions or to incur any such additional expenditures on
Grantor's behalf, or as making Lender in any way responsible or liable for any
loss, damage, or injury to the Collateral, to Grantor, or to any other person or
persons, resulting from Lender's election not to take such actions or to incur
such additional expenses. In addition, Lender's election to take any such
actions or to incur such additional expenditures shall not constitute a waiver
or forbearance by Lender of any Event of Default under this Agreement. All such
expenditures incurred or paid by Lender for such purposes will then bear
interest at the rate charged under the Note from the date incurred or paid by
Lender to the date of repayment. All such expenses shall become a part of the
Indebtedness and, at Lender's option, will (a) be payable on demand, (b) be
added to the balance of the Note and be apportioned among and be payable with
any payments to become due during either (i) the term of any applicable
insurance policy or (ii) the remaining term of the Note, or (c) be treated as a
balloon payment which will be due and payable at the Note's maturity. This
Agreement also will secure payment of these amounts. Such right shall be in
addition to all other rights and remedies to which Lender may be entitled upon
the occurrence of an Event of Default.
EVENTS OF DEFAULT. The occurrence of an Event of Default, as defined in
the Loan Agreement, shall constitute an Event of Default under this Agreement.
RIGHTS AND REMEDIES ON DEFAULT. If an Event of Default occurs under this
Agreement, at any time thereafter, Lender shall have all the rights of a secured
party under applicable law, and including, at Lender's sole election, Louisiana
Commercial Laws (La. R.S. 10: 9-101 et seq.) or those under the laws and
resolutions adopted by the Grantor. In addition and without limitation, Lender
may exercise any one or more of the following rights and remedies:
ACCELERATE INDEBTEDNESS. Lender may declare the entire Indebtedness,
immediately due and payable, without notice or further demand for payment.
SEIZURE AND SALE OF COLLATERAL IN LOUISIANA. In the event that Lender
elects to commence appropriate foreclosure proceedings under this Agreement in a
Louisiana state court, Lender may cause the Collateral, or any part or parts
thereof, to be immediately seized wherever found, and sold, whether in term of
court or in vacation, under ordinary or executory process, in accordance with
applicable Louisiana law, to the highest bidder for cash, with or without
appraisement, and without the necessity of making additional demand upon or
notifying Grantor or placing Grantor in default, all of which are expressly
waived.
CONFESSION OF JUDGMENT. For purposes of foreclosure under Louisiana
executory process procedures, Grantor confesses judgment and acknowledges to be
indebted unto and in favor of Lender, up to the full amount of the Indebtedness,
in principal, interest, costs, expenses, attorneys' fees and other fees and
charges. Grantor further confesses judgment and acknowledges to be indebted unto
and in favor of Lender in the amount of all additional advances that Lender may
make on Grantor's behalf pursuant to this Agreement, together with interest
thereon, up to a maximum of two (2) times the face amount of the aforesaid Note.
To the extent permitted under applicable Louisiana law, Grantor additionally
waives: (a) the benefit of appraisal as provided in Articles 2332, 2336, 2723
and 2724 of the Louisiana Code of Civil Procedure, and all other laws with
regard to appraisal upon judicial sale; (b) the demand and three (3) days' delay
as provided under Articles 2639 and 2721 of the Louisiana Code of Civil
Procedure; (c) the notice of seizure as provided under Articles 2293 and 2721 of
the Louisiana Code of Civil Procedure;
8
(d) the three (3) days' delay provided under Articles 2331 and 2722 of the
Louisiana Code of Civil Procedure; and (e) all other benefits provided under
Articles 2331, 2722 and 2723 of the Louisiana Code of Civil Procedure and all
other Articles not specifically mentioned above.
KEEPER. Should any or all of the Collateral be seized as an incident to
an action for the recognition or enforcement of this Agreement, by executory
process, sequestration, attachment, writ of fieri facias or otherwise, Grantor
hereby agrees that the court issuing any such order shall, if requested by
Lender, appoint Lender, or any agent designated by Lender, or any person or
entity named by Lender at the time such seizure is requested, or any time
thereafter, as Keeper of the Collateral as provided under La. R.S. 9:5136, et
seq. Such a Keeper shall be entitled to reasonable compensation. Grantor agrees
to pay the reasonable fees of such Keeper, which are hereby fixed at $500.00 per
day, which compensation to the Keeper shall also be secured by this Agreement in
the form of an additional advance as provided herein.
DECLARATION OF FACT. Should it become necessary for Lender to foreclose
under this Agreement, all declarations of fact, which are made under an
authentic act before a Notary Public in the presence of two witnesses, by a
person declaring such facts to lie within his or her knowledge, shall constitute
authentic evidence for purposes of executory process and also for purposes of
La. R.S. 9:3509.1, La. R.S. 9:3504(D)(6) and La. R.S. 10:9-508, as applicable.
DELIVER COLLATERAL. This provision applies, to the extent applicable,
if and when the Collateral for any reason is located outside the State of
Louisiana following the occurrence of any Event of Default, or should there be a
subsequent change in Louisiana law permitting such remedies. Lender may require
Grantor to deliver to Lender all or any portion of the Collateral and any and
all certificates of title and other documents relating to the Collateral. Lender
may require Grantor to assemble the Collateral and make it available to Lender
at a place to be designated by Lender. Lender also shall have full power to
enter upon the property of Grantor to take possession of and remove the
Collateral. If the Collateral contains other goods not covered by this Agreement
at the time of repossession, Grantor agrees Lender may take such other goods,
provided that Lender makes reasonable efforts to return them to Grantor after
repossession.
PUBLIC OR PRIVATE SALE OF COLLATERAL. To the extent that any of the
Collateral is then in Lender's possession, Lender shall have full power to sell,
lease, transfer, or otherwise deal with the Collateral or proceeds thereof in
its own name or that of Grantor. Lender may sell the Collateral at public
auction or private sale. Unless the Collateral threatens to decline speedily in
value or is of a type customarily sold on a recognized market, Lender will give
Grantor reasonable notice of the time after which any private sale or any other
intended disposition of the Collateral is to be made. The requirements of
reasonable notice shall be met if such notice is given at least ten (10) days
before the time of the sale or disposition. All reasonable expenses relating to
the disposition of the Collateral, including without limitation the expenses of
retaking, holding, insuring, preparing for sale and selling the Collateral,
shall become a part of the Indebtedness secured by this Agreement and shall be
payable on demand, with interest at the Note rate from date of expenditure until
repaid. Grantor agrees that any such sale shall be conclusively deemed to be
conducted in a commercially reasonable manner if it is made consistent with the
standard of similar sales of collateral by commercial banks in Marksville,
Louisiana.
APPOINT RECEIVER. This provision applies if and when the Collateral for
any reason is located
9
outside the State of Louisiana following the occurrence of any Event of Default,
or should Louisiana law change or be interpreted to permit such a remedy or
should the laws or resolutions of the Grantor permit such a remedy. Lender shall
have the following rights and remedies regarding the appointment of a receiver:
(a) Lender may have a receiver appointed as a matter of right, (b) the receiver
may be an employee of Lender and may serve without bond, and (c) all fees of the
receiver and his or her attorney shall become part of the Indebtedness secured
by this Agreement and shall be payable on demand, with interest at the Note rate
from date of expenditure until repaid.
COLLECT REVENUES, APPLY ACCOUNTS. Lender shall have the right, at its
sole option and election, at any time, if one or more Events of Default then
exist under this Agreement, to directly collect and receive all proceeds and/or
payments arising under or in any way accruing from the Collateral, as such
amounts become due and payable. In order to permit the foregoing, Grantor
unconditionally agrees to deliver to Lender, immediately following demand, any
and all of Grantor's records, ledger sheets, and other documentation, in the
form requested by Lender, with regard to the Collateral and any and all proceeds
and/or payments applicable thereto. Lender shall have the further right, if an
Event of Default then exists under this Agreement, where appropriate and within
Lender's sole discretion, to file suit, either in Lender's own name or in the
name of Grantor, to collect any and all proceeds and payments that may then
and/or in the future be due and owing under this Agreement, and if as a result
of such it is necessary for Lender to attempt to collect any such proceeds
and/or payments from the obligors therefor, Lender may compromise, settle,
extend, or renew for any period (whether or not longer than the original period)
any obligation or indebtedness thereunder or evidenced thereby, or surrender,
release, or exchange all or any part of said obligation or indebtedness, without
affecting the liability of Grantor under this Agreement or under the
Indebtedness. To that end, Grantor hereby irrevocably constitutes and appoints
Lender as its attorney-in-fact, coupled with an interest and with full power of
substitution, to take any and all such actions and any and all other actions
permitted hereby, either in the name of Grantor or Lender.
ADDITIONAL EXPENSES. In the event that it should become necessary for
Lender to conduct a search for any of the Collateral in connection with any
foreclosure action, or should it be necessary to remove the Collateral, or any
part or parts thereof, from the premises in which or on which the Collateral is
then located, and/or to store and/or refurbish such Collateral, Grantor agrees
to reimburse Lender for the cost of conducting such a search and/or removing
and/or storing and/or refurbishing such Collateral, which additional expense
shall also be secured by the lien of this Agreement.
SPECIFIC PERFORMANCE. Lender may, in addition to the foregoing
remedies, or in lieu thereof, in Lender's sole discretion, commence an
appropriate action against Grantor seeking specific performance of any covenant
contained herein, or in aid of the execution or enforcement of any power herein
granted.
OBTAIN DEFICIENCY. Lender may obtain a judgment against Grantor for any
deficiency remaining on the Indebtedness due to Lender after application of all
amounts received from the exercise of the rights provided in this Agreement and
any Related Document.
OTHER RIGHTS AND REMEDIES. In addition, Lender shall have and may
exercise any or all other rights and remedies it may have available at law, in
equity, or otherwise.
CUMULATIVE REMEDIES. All of Lender's rights and remedies, whether
evidenced by this
10
Agreement or the Related Documents or by any other writing, shall be cumulative
and may be exercised singularly or concurrently. Election by Lender to pursue
any remedy shall not exclude pursuit of any other remedy, and an election to
make expenditures or to take action to perform an obligation of Grantor under
this Agreement, after Grantor's failure to perform, shall not affect Lender's
right to declare a default and to exercise its remedies.
ASSIGNMENT OF INDEBTEDNESS. Grantor hereby recognizes and agrees that Lender
may, subject to the terms of the Loan Agreement, assign all or any portion of
the Indebtedness to one or more third party creditors. Such transfers may
include, but are not limited to, sales of participation interests in the
Indebtedness. Grantor specifically agrees and consents to all such transfers and
assignments. Grantor additionally agrees that any and all of the Indebtedness in
favor of such a third party assignee, for the limited purposes set forth above,
will be secured by the Collateral.
PROTECTION OF LENDER'S SECURITY RIGHTS. Grantor will be fully responsible for
any losses that Lender may suffer as a result of anyone other than Lender, its
successors or assigns, asserting any rights or interest in or to the Collateral.
Subject thereto, Grantor agrees to appear in and to defend all actions or
proceedings purporting to affect Lender's security interests in any of the
Collateral subject to this Agreement and any of the rights and powers granted
Lender hereunder. In the event that Grantor fails to do what is required of it
under this Agreement, or if any action or proceeding is commenced naming Lender
as a party or affecting Lender's security interests or the rights and powers
granted under this Agreement, then Lender may, without releasing Grantor from
any of its obligations under this Agreement, take all reasonable steps to
protect the security of this Agreement, including without limitation making
additional advances on Grantor's behalf as provided herein.
INDEMNIFICATION OF LENDER. Grantor agrees to indemnify, to defend and to save
and hold Lender harmless from any and all claims, suits, obligations, damages,
losses, costs, expenses (including without limitation Lender's attorneys' fees),
demands, liabilities, penalties, fines and forfeitures of any nature whatsoever
that may be asserted against or incurred by Lender arising out of or in any
manner occasioned by this Agreement and the exercise of the rights and remedies
granted Lender hereunder, except for those which result from lender's
negligence, gross negligence or intentional acts or omissions. The foregoing
indemnity provisions shall survive the termination of this Agreement as to all
matters arising or accruing prior to such termination, and the foregoing
indemnity shall survive in the event that Lender elects to exercise any of the
remedies as provided under this Agreement following default hereunder.
EXECUTION OF ADDITIONAL DOCUMENTS. Grantor agrees to execute all additional
documents, instruments and agreements that are necessary and proper, in form and
substance satisfactory to Lender, to keep this Agreement in effect, to better
reflect the true intent of this Agreement, and to consummate fully all of the
transactions contemplated hereby and by any other agreement, instrument or
document heretofore, executed by Grantor and delivered to Lender.
INSPECTION; AUDITS. Lender and its agents may periodically enter upon Grantor's
premises at reasonable hours and inspect the Collateral. Lender and its agents
may also periodically conduct audits of the Collateral and may further inspect
and audit Grantor's books and records that in any way pertain to the Collateral
and any part or parts thereof.
11
APPLICATION OF PAYMENTS. Grantor agrees that all payments and other sums and
amounts received by Lender under the Indebtedness or under this Agreement, shall
be applied: first, to reimburse Lender for its costs of collecting the same
(including but not limited to, reimbursement of Lender's reasonable attorneys'
fees); second, to the repayment of interest on all additional advances that
Lender may have made on Grantor's behalf pursuant to this Agreement; third, to
the payment of principal of all such additional advances; and finally, to the
payment of principal and interest on the Indebtedness then outstanding, which
may be applied in such order and priority as Lender may determine within its
sole discretion.
TAXATION. In the event that there should be any change in law with regard to
taxation of security agreements or the debts they secure, Grantor agrees to pay
any taxes, assessments or charges that may be imposed upon Lender as a result of
this Agreement.
EFFECT OF WAIVERS. Grantor has waived, and/or does by these presents waive,
presentment for payment, protest, notice of protest and notice of nonpayment
under all of the Indebtedness secured by this Agreement. Grantor has further
waived, and/or does by these presents waive, all pleas of division and
discussion, and all similar rights with regard to the Indebtedness, and agrees
that Grantor shall remain liable, together with any and all Guarantors, on a
"solidary" or "joint and several" basis. Grantor further agrees that discharge
or release of any party who is, may, or will be liable to Lender under any of
the Indebtedness, or the release of the Collateral or any other collateral
directly or indirectly securing repayment of the same, shall not have the effect
of releasing or otherwise diminishing or reducing the actual or potential
liability of Grantor and/or any other party or parties guaranteeing payment of
the Indebtedness, who shall remain liable to Lender, and/or of releasing any
Collateral or other collateral that is not expressly released by Lender. Grantor
additionally agrees that Lender's acceptance of payments other than in
accordance with the terms of any agreement or agreements governing repayment of
the Indebtedness, or Lender's subsequent agreement to extend or modify such
repayment terms, shall likewise not have the effect of releasing any party or
parties from their respective obligations to Lender, and/or of releasing any of
the Collateral or other collateral directly or indirectly securing repayment of
the Indebtedness. In addition, no course of dealing between Grantor and Lender,
nor any failure or delay on the part of Lender to exercise any of the rights and
remedies granted to Lender under this Agreement, or under any other agreement or
agreements by and between Grantor and Lender, shall have the effect of waiving
any of Lender's rights and remedies. Any partial exercise of any rights and
remedies granted to Lender shall furthermore not constitute a waiver of any of
Lender's other rights and remedies, it being Grantor's intent and agreement that
Lender's rights and remedies shall be cumulative in nature. Grantor further
agrees that, upon the occurrence of any Event of Default under this Agreement,
any waiver or forbearance on the part of Lender to pursue the rights and
remedies available to Lender, shall be binding upon Lender only to the extent
that Lender specifically agrees to any such waiver or forbearance in writing. A
waiver or forbearance as to one Event of Default shall not constitute a waiver
or forbearance as to any other Event of Default. None of the warranties,
conditions, provisions and terms contained in this Agreement or any other
agreement, document, or instrument now or hereafter executed by Grantor and
delivered to Lender, shall be deemed to have been waived by any act or knowledge
of Lender, its agents, officers or employees; but only by an instrument in
writing specifying such waiver, signed by a duly authorized officer of Lender
and delivered to Grantor.
MISCELLANEOUS PROVISIONS. The following miscellaneous provisions are a part of
this Agreement:
12
AMENDMENTS. This Agreement, together with any Related Documents,
constitutes the entire understanding and agreement of the parties as to the
matters set forth in this Agreement. No alteration of or amendment to this
Agreement shall be effective unless given in writing and signed by the party or
parties sought to be charged or bound by the alteration or amendment.
APPLICABLE LAW. THIS AGREEMENT HAS BEEN DELIVERED TO LENDER AND
ACCEPTED BY LENDER IN THE STATE OF LOUISIANA. LENDER AND GRANTOR HEREBY WAIVE
THE RIGHT TO ANY JURY TRIAL IN ANY ACTION, PROCEEDING, OR COUNTERCLAIM BROUGHT
BY EITHER LENDER OR GRANTOR AGAINST THE OTHER. THIS AGREEMENT SHALL BE GOVERNED
BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF LOUISIANA.
ATTORNEYS' FEES; EXPENSES. Grantor agrees to pay upon demand all of
Lender's reasonable costs and expenses, including attorneys' fees and Lender's
legal expenses, incurred in connection with the enforcement of this Agreement.
Lender may pay someone else to help enforce this Agreement, and Grantor shall
pay the costs and expenses of such enforcement. Costs and expenses include
Lender's attorneys' fees and legal expenses whether or not there is a lawsuit,
including attorneys' fees and legal expenses for bankruptcy proceedings (and
including efforts to modify or vacate any automatic stay or injunction),
appeals, and any anticipated post-judgment collection services. Grantor also
shall pay all court costs and such additional fees as may be directed by the
court.
CAPTION HEADINGS. Caption headings in this Agreement are for
convenience purposes only and are not to be used to interpret or define the
provisions of this Agreement.
NOTICES. To give Grantor any notice required under this Agreement,
Lender may hand deliver or mail such notice to Grantor. Lender will deliver or
mail any notice to Grantor at any address which Grantor may have given Lender by
written notice as provided in this paragraph. To give Lender any notice under
this Agreement, Grantor shall mail the notice to Lender by registered or
certified mail at the address specified in this Agreement, or at any other
address that Lender may have given to Grantor by written notice as provided in
this paragraph. All notices required or permitted under this Agreement must be
in writing and will be considered as given on the day it is delivered by hand or
deposited in the U.S. Mail, by registered or certified mail to the address
specified in this Agreement.
POWER OF ATTORNEY. Grantor hereby appoints Lender, effective upon an
Event of Default, as its true and lawful attorney-in-fact, irrevocably, with
full power of substitution to do the following: (a) to demand, collect, receive,
receipt for, ▇▇▇ and recover all sums of money or other property which may now
or hereafter become due, owing or payable from the Collateral; (b) to execute,
sign and endorse any and all claims, instruments, receipts, checks, drafts or
warrants issued in payment for the Collateral; (c) to settle or compromise any
and all claims arising under the Collateral, and, in the place and stead of
Grantor, to execute and deliver its release and settlement for the claim; and
(d) to file any claim or claims or to take any action or institute or take part
in any proceedings, either in its own name or in the name of Grantor, or
otherwise, which in the discretion of Lender may seem to be necessary or
advisable. This power is given as security for the Indebtedness, and the
authority hereby conferred is and shall be irrevocable and shall remain in full
force and effect until the Event of Default is cured.
SEVERABILITY. If a court of competent jurisdiction finds any provision
of this Agreement to be
13
invalid or unenforceable as to any person or circumstance, such finding shall
not render that provision invalid or unenforceable as to any other persons or
circumstances. If feasible, any such offending provision shall be deemed to be
modified to be within the limits of enforceability or validity; however, if the
offending provision cannot be so modified, it shall be stricken and all other
provisions of this Agreement in all other respects shall remain valid and
enforceable.
SOLE DISCRETION OF LENDER. Whenever Lender's consent or approval is
required under this Agreement, the decision as to whether or not to consent or
approve shall be in the sole and exclusive discretion of Lender and Lender's
decision shall be final and conclusive.
SUCCESSORS AND ASSIGNS BOUND; SOLIDARY LIABILITY. Grantor's obligations
and agreements under this Agreement shall be binding upon Grantor's successors
and assigns.
LIMITED WAIVER OF SOVEREIGN IMMUNITY; CONSENT TO JURISDICTION. This Agreement
constitutes a Loan Document as defined in the Loan Agreement. As such and
without limiting the scope of the Loan Agreement, the provisions of Section
15.10 of the Loan Agreement apply to this Agreement and are incorporated herein
by reference.
COMPLIANCE WITH 25 U.S.C. ss.81. In compliance with 25 U.S.C. ss.81 the
residence and occupation of the parties is stated as follows:
Party in interest: TUNICA-BILOXI TRIBE OF LOUISIANA
Residence: ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Occupation: A federally recognized Indian Tribe
Party in interest: HIBERNIA NATIONAL BANK
Residence: ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Occupation: Commercial bank
Scope of Authority:
The Grantor is authorized to execute the within document by a
resolution adopted by the Tribal Council of the Grantor at a meeting at
Marksville, Louisiana, on April 19, 1999. The Tribal Council exercises its
authority in this instance because it believes the purchase of the Equipment
related to its Class III gaming facility in Marksville, Louisiana, and the
financing thereof to be in accordance with the long-range economic objectives of
the Tribe.
This document was executed on behalf of the Grantor on or about 12:10
p.m. on May 28, 1999, at Marksville, Louisiana, and on behalf of the Lendor on
or about 12:10 p.m. on May 28, 1999, at Marksville, Louisiana.
This instrument shall terminate upon payment in full of the
indebtedness, provided that in any event this instrument shall expire not later
than 50 years from the date hereof.
14
GRANTOR ACKNOWLEDGES HAVING READ ALL THE PROVISIONS OF THIS
COMMERCIAL SECURITY AGREEMENT, AND GRANTOR AGREES TO ITS TERMS. THIS
AGREEMENT IS DATED MAY 28, 1999.
GRANTOR:
TUNICA-BILOXI TRIBE OF LOUISIANA
BY: s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇.
----------------------------------------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇., CHAIRMAN
LENDER:
HIBERNIA NATIONAL BANK
BY: s/ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
----------------------------------------------------------
▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ITS VICE PRESIDENT
BIA APPROVAL
------------
THE FOREGOING DOCUMENT IS
APPROVED PURSUANT TO 25 U.S.C. 81:
UNITED STATES DEPARTMENT OF THE INTERIOR,
BUREAU OF INDIAN AFFAIRS:
By
-----------------------------------------------------------
Area Director of the Eastern Area Office
of the Bureau of Indian Affairs of the Secretary
of the Interior and the Commissioner of Indian Affairs,
acting under delegated authority.